GDF SUEZ Energie Nederland

CREATING A SUSTAINABLE

BIOMASS SUPPLY CHAIN IN

MOZAMBIQUE

World Biofuel Markets

13-15 March 2012, Rotterdam, The Netherlands

Maarten Gnoth Manager Sustainability Projects

GDF SUEZ Energie Nederland

CONTEXT

Commercially available solid biomass of current geographic origins likely to reach full potential in the future

Incremental demand likely to be covered by biomass from developing countries

Availability of competitively priced and sustainable biomass from these countries is currently low

GDF SUEZ and Solidaridad work together since 2008 to develop basic elements for a sustainable biomass supply chain from Mozambique

Approach: addressing and solving uncertainties to reduce risk profile and build viable business cases

GDF SUEZ Energie Nederland

(JOINT) TRACK RECORD

2008 – 2009: Solidaridad project in Mozambique with Biopec funding. Main results:

Improved understanding of Mozambican market potential and challenges for solid biomass

Establishment by Solidaridad of Fair Biomass Mozambique (FBM) Lda. (farmer association company with currently 12 members)

Development of web-based traceability system

2009 -2012: Solidaridad project with EC funding Main objectives:

Development of viable biomass supply chains for domestic and/or export markets

Installation of biomass pelletizer at FBM Lda.

Pilot and role out of agro forestry program

Policy support to Government of Mozambique

GDF SUEZ Energie Nederland

THE NEXT STEP

2010-2012: joint project ‘Triple bottom line torrefied biomass supply chain from Mozambique’

Funding from Global Sustainable Biomass Fund:

Commissioned by Dutch Ministry of Foreign Affairs

Executed by Agentschap NL / Agency NL

Goal: promote production of sustainable

biomass for energy purposes in

developing countries

50% co-financing for companies,

75% for NGO’s

Our proposal is one of 16 approved, out of a total of 56

GDF SUEZ Energie Nederland

Objective:

• Development of a certified, sustainable (triple bottom line) biomass supply chain from agricultural by products and short rotation coppiced trees from

smallholder producers in Mozambique, and evaluation of the feasibility of

torrefaction under Mozambican circumstances

Activities:

• Developing a bankable business plan for torrefied biomass from Mozambique

• Sharing lessons learned with Government of Mozambique and others

OBJECTIVE & ACTIVITIES

Q4 Q1 Q2 Q3 Q4 Q1 Q2

Sourcing and selection biomass (sustainable, applicable,

feasible)

Building a sustainable biomass supply chain incl. agro forestry

Torrefaction sampling and power station testing

Sustainability assessment, certification and traceability

Financial modeling / Business Case development

GDF SUEZ Energie Nederland

BIOMASS IDENTIFICATION

• Origination of biomass

• Selection on sourcing, availability & logistics

• Selection available on sustainability criteria

• Selection on local stakeholders

• Sample lab testing on chemical & physical comp.

• Selection on technical applicability for torrefaction • Selection on technical applicability for co-firing

• Selection on commercial feasibility

• Integrated in business modeling

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BIOMASS SUPPLY CHAIN

Chipper / cuttermill

Wood (soft/exotic)

BIOMASS FEEDSTOCK

Harvesting & collecting

Other (Bamboo, bush etc.)

Transport Blending & Storage

Torrefaction

Pelletizing

Storage

Briquetting

Prepared carbon

Storage at port

Sea vessel loading

EXPORT

Shipping

Storage

Soil amendment

LOCAL TO LOCAL

Charcoal Local cement

factory / power plant ?

Transport

Transport

CONVERSION

SCENARIO 2

SCENARIO 1

Agro residues Smallholders / Outgrowers

GDF SUEZ Energie Nederland

Business case Local-to-LOCAL

GDF SUEZ Energie Nederland

Business case Local-to-EXPORT

GDF SUEZ Energie Nederland

Storage at port

Sea vessel loading

EXPORT

Shipping

Transport

Torrefaction &

pelletization

SCENARIO 2

SC

EN

AR

IO 1

Harvesting &

collecting by local population

BIOMASS

FEEDSTOCK

Bamboo Nacala corridor

Farmers cooperation in

bamboo storage Bamboo collection fixed route

Storage

Storage

Chipper / cuttermill

CONVERSION

Business case Local-to-EXPORT

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Business case Local-to-EXPORT

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TORREFACTION &

POWER STATION TESTING

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SUSTAINABILITY

Principle Clarification Cramer

(NTA 8080)

Corbey RED UK Belgium

(LBE)

IWPB

1 GHG

BALANCE

Positive CO2 balance of total biomass

supply chain (against conventional) Will

2 CARBON

STOCKS

Production of biomass not impacting

high carbon stocks in vegetation & soil X Will

3 BIO-

DIVERSITY

No production of biomass at protected

or vulnerable biodiversity X Will

4 SOIL Soil (quality) is maintained or improved X X X Aim to

5 WATER Water not exhausted and water quality

maintained or improved X X X X Aim to

6 AIR Air quality is maintained or improved X X X X Aim to

7 SOCIAL Preserve food- and local biomass

applications from unfair competition X X X Aim to

8 LOCAL

WELFARE

Production of biomass contributes to

local prosperity X X X X Aim to

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BUSINESS CASE DEVELOPMENT

Main findings:

• Theoretical potential biomass in Mozambique is high

• Availability of underutilized biomass does not match minimum scale

for export

• Security of large-scale supply requires nucleus estate

• Logistics and infrastructure are challenging

• Availability of qualified people and service industry is limited

• Complicated legislation for shipping/import torrefied biomass (MSDS, self-heating test, export/import permits, REACH, IMO etc.)

What is needed to develop an export supply chain of torrefied biomass from Mozambique?

Our approach:

1. Local-to-local supply chain: stepping stone model and learning vehicle

2. Export supply chain: hypothetical - based on some actual building blocks

GDF SUEZ Energie Nederland